TRUMP’s external revenue policy may disrupt global trade — OYEDELE

Wednesday, January 22, 2025 - Taiwo Oyedele, Chairman of Nigeria’s Presidential Committee on Fiscal Policy and Tax Reforms, has warned that the external revenue service announced by U.S. President Donald Trump could disrupt international trade and complicate the global tax system.

Oyedele made the statement via his X handle on Monday night following Trump’s inauguration, where the U.S. president unveiled the plan.

During the event, Trump announced, “Instead of taxing our citizens to enrich other countries, we tariff and tax other countries to enrich our citizens. For this purpose, we are establishing the External Revenue Service to collect all tariffs, duties, and revenue. It will be a massive amount of money pouring into our treasury coming from far.”

Oyedele described the move as one with potential global implications, stating, “The 47th President of the United States, Donald J. Trump, announced plans to establish an External Revenue Service to impose tariffs and taxes on other countries. This move could disrupt international trade and further complicate the already complex global tax system, highlighting the importance of our ongoing tax reforms.”

He emphasized the need for Nigeria to focus on tax reforms to mitigate potential challenges and leverage opportunities presented by such international developments.

Nigeria has been pursuing significant tax reforms, with President Bola Tinubu recently transmitting four tax-related bills to the National Assembly, including the Nigeria Tax Bill and the Nigeria Revenue Service Establishment Bill. These proposals aim to revamp the country's fiscal framework but have sparked debates over equity, implementation, and economic implications.

The Nigerian Governors Forum (NGF) has endorsed a revised Value Added Tax (VAT) sharing formula to ensure equitable resource distribution among states, a move Oyedele supports. The proposed formula allocates 50% based on equality, 30% on derivation, and 20% on population.

Oyedele, speaking at The Platform, an event hosted by The Covenant Nation, stressed the importance of gradual implementation of reforms, acknowledging political considerations and the need for compromise in fiscal policy adjustments.